Rumor: MOG Has Been Acquired By HTC/Beats

We've heard from a single source that subscription music service MOG has been acquired by audio technology company Beats Audio, which is part owned by phone maker HTC

It's only one source, so we'd categorize it as a rumor at this point.

MOG would not comment, saying only, "We're always looking for the best opportunity for our business and shareholders, but don't comment on specifics of those conversations. Nothing to confirm at this time."

We heard the deal was signed last week. No word on price or what happens to the current MOG service and its subscribers.

Last month, MOG CEO David Hyman denied rumors that MOG was for sale, but admitted that the company had talked to potential buyers. Hyman told Reuters that MOG has 500,000 active users, but didn't say how many were paying for the service.

MOG is one of the smaller players up against Spotify, which recently claimed more than 3 million paying users.

Beats started off as an audio equipment company — its best known product is a set of headphones designed by Dr. Dre — but also provides technology that is supposed to make compressed digital music sound better. HTC invested $300 million into Beats last year and Beats technology has begun shipping on HTC phones.

In February, Om Malik reported that Beats was close to launching its own music subscription service to ship on new HTC phones.

Updated: GigaOm also reports that term sheets were sent back and forth between the two companies a few weeks ago.

More details as we dig them up....

Republished with permission from Business Insider.